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Definition

Value Chain

Each company department can be thought of as a link in the company’s internal value chain. That is, each department carries out value-creating activities to design, produce, market, deliver, and support the firm’s products. It is the string of activities that moves a product from the raw material stage, through manufacturing and distribution, and ultimately to the end user. 

So value chain can be defined as the series of internal departments that carry out value-creating activities to design produce, market, deliver, and support a firm’s products.

The firm’s success depends not only on how well each department performs its work but also on how well the various departments coordinate their activities.


Value chain is the supply chain, the manufacture, and the distribution channel viewed as an integrated system.

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